TIDMCBP
RNS Number : 7343G
Curtis Banks Group PLC
31 March 2022
31 March 2022
Curtis Banks Group plc
("Curtis Banks" or the "Group")
Final Results for the 12 Months to 31 December 2021
Curtis Banks Group PLC is pleased to announce its final results
for the 12 months to 31 December 2021. These results represent the
full 12 month period.
Financial Highlights
-- Revenue increased by 17.5% to GBP63.3m (2020: GBP53.9m)
-- Adjusted profit before tax(1 4) increased by 4.7% to GBP14.0m (2020 restated: GBP13.4m)
-- Adjusted operating margin(2 4) decreased to 23.5% (2020
restated: 26.0%), mainly impacted by the GBP3.9m decrease of
interest income (note 2) compared to the prior year. If interest
income had remained at the same level, the adjusted operating
margin would be 28.0%
-- Profit before tax increased by 22.2% to GBP9.3m (2020 restated: GBP7.6m)
-- Adjusted diluted EPS of 16.9p (2020: 17.9p)(3 4)
-- Gross organic growth in Full and Mid SIPP numbers of 7.9%
(2020: 7.8%) with total SIPPs, including third party administered,
now 79,679 (2020: 82,224)
-- Attrition rate on own Full and Mid SIPPs increased to 6.1% (2020: 4.6%)
-- Assets under Administration ("AuA") increased by 15.4% to GBP37.4bn (2020: GBP32.4bn)
-- Proposed final dividend of 6.5p (2020: 6.5p) making a full year payment of 9.0p (2020: 9.0p)
Operational Highlights
-- Gross increase in core Full and Mid SIPPs of 7.9%, improving
both the quantum and quality of earnings.
-- Revisions to our annual fixed sterling charge model have
further improved the annuity-like revenue stream with no negative
impact on attrition rates. Annual SIPP administration fees
increased by 20% in February 2021, with a further 7% increase in
January 2022 to annual and transactional charges.
-- Progress continues with the integration of Talbot and Muir
and Dunstan Thomas. Dunstan Thomas faced revenue headwinds due to
COVID-19, but continues to improve the customer proposition and
revenue diversification opportunities through its technology
solutions.
-- The Group continues to make good progress on delivering
operational efficiencies through our five-year systems strategy,
which remains on time and on budget.
-- The Curtis Banks Group ESG Strategy has been formulated and
includes commitments to act on issues most important to the Group
and its stakeholders, including the promotion of intergenerational
wealth transfer and fairness.
Highlights and Key Performance Indicators:
2021 2020
Restated
Financial
Revenue GBP63.3m GBP53.9m
Adjusted profit before tax1 GBP14.0m GBP13.4m
4
Profit before tax GBP9.3m GBP7.6m3
Adjusted operating margin2
4 23.5% 26.0%
Diluted EPS 11.5p 9.7p3
Adjusted diluted EPS4 16.9p 17.9p
Operational Highlights
Number of SIPPs administered 79,679 82,224
Assets under Administration GBP37.4bn GBP32.4bn
Total organic new Full and
Mid SIPPs in year 4,329 3,700
Attrition rates (Mid & Full
SIPP) 6.1% 4.6%
Number of properties administered 9,065 8,905
1 Profit before tax, amortisation and adjusting items
2 The ratio of operating profit before amortisation and
adjusting items to revenue.
3 Results for the year ended 31 December 2020 have been restated
to account for measurement period adjustments arising under IFRS 3
Business Combinations.
4 In addition to statutory IFRS performance measures, the Group
has presented a number of non-statutory alternative performance
measures ("APMs"). The Board believes that the APMs used give a
more representative view of the underlying performance of the Group
and enhance comparability of information between reporting
periods.
Will Self, Chief Executive Officer of Curtis Banks, commented:
"These are robust results given the COVID-19 headwinds the Group
faced in 2021 and are testament to the strengths of the business,
its suite of products and our operational teams.
"Dunstan Thomas, which was acquired in 2020, faced some
significant challenges resulting from the COVID-19 pandemic which
impacted revenue and profitability. However, the integration of the
business within the Group is progressing well thanks to its
contribution to the diversification of intermediary and customer
relationships, through the launch of Fintech products like Imago.
The value that Dunstan Thomas delivered to the Group is clearly
evident and as the macro-economy recovers from COVID-19 we expect
significant improvement in the next financial year.
Changes made to our pricing policy now mean that 88% of our core
revenues recur in perpetuity, with fixed rates of increase
providing higher quality revenues that protect earnings against
inflation. This, alongside the prospect of a rising interest rate
environment, provides confidence that we will see additional
earnings growth in 2022. There was also a notable decrease in
delayed SIPP attrition rates by October, as the SIPP market began
to normalise following the phasing out of COVID-19 restrictions,
and this has continued into 2022.
"We are maximising the strong organic growth signals witnessed
in our core SIPP products and we remain well positioned to deliver
our medium-term growth strategy from a more efficient systems
platform and a transition to a more diverse retirement solutions
group."
Analyst Presentation
An analyst briefing is being held at 09:30 BST on 31 March 2022
via an online video conference facility. To register your
attendance, please contact curtisbanks@instinctif.com.
For more information, please contact:
Curtis Banks Group PLC Via Instinctif Partners
Will Self - Chief Executive Officer
Dan Cowland - Chief Financial Officer
Peel Hunt LLP (Nominated Adviser
& Joint Broker) +44 (0)20 7418 8900
James Britton
Rishi Shah
Singer Capital Markets (Joint Broker) +44 (0)20 7496 3000
Mark Taylor
Rachel Hayes
Instinctif Partners (Financial PR) curtisbanks@instinctif.com
Mark Walter +44 (0)20 7457 2020
Joe Quinlan
Chairman's Statement
I am pleased to report the Curtis Banks Group results for the
year ended 31 December 2021. The business has continued its growth
trajectory while taking specific actions to improve the quality of
earnings and the efficiency of operations, against a tough external
backdrop.
Despite some headwinds, 2021 witnessed the continued delivery of
our stated strategic objectives, delivering strong organic growth
in our core SIPP products and the further integration of Talbot and
Muir. The Group has continued to broaden the range of services it
offers to its customers. We adjusted our fee model early in 2021 to
improve the quality and visibility of revenue, while also seeking
to bring more standardisation of charging structures across the
various SIPP books that have been acquired over several years. This
provides us with a strong platform for our medium-term growth
ambitions. Following the Dunstan Thomas acquisition, the Group has
improved its operations through further technical efficiencies and
can now provide incremental value-added technology solutions and
services. This puts the Group in a strong position to capture the
growth in the advised retirement market place.
The Group has also continued to progress with its systems
strategy on time and on budget. However, the Board is now
considering / evaluating how this strategy might be enhanced and
accelerated to achieve the benefits sooner, by maximising the
growth achieved by our core products alongside the new technology
solutions being supported by Dunstan Thomas. This enables us to
further enhance our product proposition and service quality for our
customers and intermediaries, whilst also accelerating achievement
of our target operating model and growing the operating margin in
the medium term.
2021 Review
We have delivered a year of continued growth in both revenue and
profits. Revenue increased by 18% to GBP63.3m, reflecting primarily
the contribution from a maiden full year of Talbot and Muir and
Dunstan Thomas, as well as steady underlying growth in the core
business of Full and Mid SIPPs. The Group's adjusted profit before
tax grew by 4.7% to GBP14.0m, albeit impacted by an
underperformance in Dunstan Thomas which has been more severely
impacted by the COVID-19 pandemic. The headwinds experienced by
Dunstan Thomas were not uncommon in the financial service
technology sector as the relative reluctance of customers to invest
in new technology solutions or upgrades, as a result of the
pandemic.
The scale of the business continues to grow with Assets under
Administration ("AuA") up 15.4% to GBP37.4bn (2020: GBP32.4bn). The
Group saw a gross increase of 4,329 (7.9%) in Full and Mid SIPPs,
including 693 new SIPPs from Talbot and Muir in the year, offset by
attrition of 6.1%. The growth in attrition from 4.6% to 6.1% during
the year can be attributed to a COVID-19 lag effect following the
lower than anticipated rate in 2020, although there is already
evidence that the attrition rate is normalising with the return to
pre-COVID levels in Q4 2021 and into 2022. In comparison, the
non-core eSIPPs and third party administered SIPPs had experienced
higher attrition rates (14.9% and 10.5% respectively) with minimal
organic growth. Together the total SIPPs number has reduced to
79,679 (2020: 82,224).
The Group's revenue model in the pension administration business
is highly resilient with a high proportion of fixed, recurring
income which is adjusted annually for inflation. As mentioned
above, we made a step change in early 2021 by applying a 20%
increase to annual SIPP administration fee paid on Full and Mid
SIPPs. At the same time, we introduced arrangements for customers
to share more fully in the interest income generated from their
cash balances. These amendments have improved both the quality and
visibility of the Group's revenue, while also benefiting customers
and have had no discernible direct impact on attrition.
The two acquisitions of Talbot and Muir and Dunstan Thomas have
seen a full financial year within the Group. Talbot and Muir
actively contributed to the growth in volumes achieved during the
year, and also the margin of the pension administration segment.
There is clear evidence that Dunstan Thomas has been impacted by
COVID-19 to a greater extent than the rest of the Group's
activities as the nature of its business contracts leads to a less
predictable revenue pattern than our pension administration
business; however, it remains an important component of the Group's
business and a key contributor to our growth strategy. We continue
to be excited about the potential for Dunstan Thomas to enhance and
develop our product and service offering, while creating
significant new opportunities for the use of technology in the
retirement marketplace.
ESG
Curtis Banks plays an important role in the lives of our
customers, providing the platform to support them and their
families in retirement. We recognise our responsibility in this
regard, as well as the commitments we have to our staff, customers,
communities and the wider environment. I am therefore very pleased
to present the Group's purpose-led ESG strategy within this report,
which sets our priorities and plans, particularly around the issue
of intergenerational fairness. The Group's ESG performance is
overseen at Board level by Jill Lucas alongside Group CEO, Will
Self. We very much look forward to providing timely updates as we
formalise this important aspect of the business.
Dividend
We paid an interim dividend of 2.5p per share (2020: 2.5p) on 12
November 2021 and the Board proposes a final dividend of 6.5p per
share (2020: 6.5p) which, if approved by shareholders, will be paid
on 1 June 2022 to shareholders on the register at the close of
business on 6 May 2022. Total dividends for the year are therefore
9.0p per share (2020: 9.0p).
Outlook
The Board remains fully committed to implementing the Group's
strategy and indeed to accelerate our initiatives. This will
include efforts to maximise the recent growth in our core business,
complemented by leveraging the technology capability provided by
Dunstan Thomas.
We will look to achieve our fundamental objectives whilst also
continuing to meet the increasing financial costs of regulatory
change on our otherwise largely controllable cost base. The
expectation is that material additional costs will be required to
support the Pensions Dashboard initiative and the FCA's proposals
around Consumer Duty will add to the general inflationary pressure
on our expenditure.
That aside, the Board remains confident that the Group is well
positioned to deliver on its objectives, driven by organic growth
from high-quality recurring fee revenues, which are expected to be
enhanced by normalised levels of customer attrition. In addition,
we expect greater interest returns for both the Group and our
customers. Assuming sentiment improves, we also expect a recovery
in performance at Dunstan Thomas. Finally, we believe that further
improvements to our operating margins are achievable as we
transition to a more diverse provider of administration, technology
and complementary services to the advised retirement market
providing multiple complementary solutions, including FinTech,
Legal and Property services.
Section 172
The disclosures required under section 172 of the Companies Act
are included in the Directors' report.
Chris Macdonald
Chairman
30 March 2022
Chief Executive Officer's Review
I am delighted to report on another year where we made good
progress, adding scale and diversification to the business,
strengthening our platform for the long-term to provide sustainable
growth. This is underpinned by our on-going transition from a
predominantly SIPP administration business to a more diverse
retirement group providing multiple complementary services,
including FinTech, Legal and Property services, to the advised pre
and post retirement market.
Delivery of strategic objectives
Dunstan Thomas continues to play a critical role in enabling the
diversification of Curtis Banks into a diverse provider of
administration, technology and complementary services to the
advised retirement market. Specific progress made in 2021 includes
the launch of Imago Administration for Small Self-Administered
Schemes (SSAS) during the first quarter. Advanced discussions are
taking place with potential customers for the platform and clear
plans have been drawn on how the platform can be combined with
Curtis Banks Trustee Services for third party product
provision.
Dunstan Thomas continues to be the backbone of CB Labs, our
innovation hub and collaboration centre, which is also helping to
drive operational efficiency and uncover new product opportunities.
CB Labs is bringing a clear bank of ideas and technical concepts to
life. Priority concepts that have moved to prototyping and beyond
during 2021 include:
- a new Chatbot developed and launched using artificial
intelligence that has facilitated customer and adviser queries;
- a suite of new adviser tools including Annual Allowance and
Salary Sacrifice calculators with others in the development
pipeline;
- an enhanced suite of new and fully integrated solutions,
including a low code Integro CX portal framework that is more agile
and can be adopted and integrated in different environments.
The initiatives listed above broaden Curtis Banks advisers'
capabilities, while expanding the suite of products available
directly via IFA platforms. These developments are earnings
enhancing and strengthen our potential to grow market share and
expand our target market by using technology to diversify Curtis
Banks' offering.
System transformation and acceleration of our ambition
We remain on track to deliver on our systems strategy which will
see existing operational systems within Curtis Banks, and all of
our back-office systems, move into Navision, one of our incumbent
platforms. We anticipate the resulting cost savings for the Group
to amount to GBP1.2m per annum upon completion. In 2022, we are now
beyond the half-way stage and there is an opportunity to accelerate
the process to enable a quicker roll-out of an enhanced proposition
to our customers and intermediaries, moving closer to full
implementation of our target operating model and a consequent
improvement in operating margin.
Given our ambitions in the pre and post retirement market, it is
clear that we have an opportunity to accelerate our existing
strategic deliverables as well as broaden our proposition. Not only
could this bring forward the existing project benefits but also
ensure that our proposition leads the sector in delivering customer
centric retirement solutions in a digital and efficient way. We are
exploring how this will impact our investment timeline and will
provide further market updates this summer.
Operational Review
Curtis Banks revenues increased by 18% in 2021, driven primarily
by the inclusion of both Dunstan Thomas and Talbot and Muir for the
full 12 months, as well as the underlying growth of our core
business. Our predictable, highly cash generative business model
was further in evidence when our new, fixed-fee charging structure
enabled us to increase annual SIPP admin fees by 20% in February
2021 with negligible impact on customer attrition. This led to a
material increase in fee income by 11% compared to 2020, and by 22%
when including the contribution from Talbot and Muir. This has
resulted in 62% (2020: 54%) of revenue now attributable to
predictable, fixed fees. This initiative not only improves our
quality of earnings, but is also a long-term strategic move which
leaves Curtis Banks well positioned to benefit from a rising
interest rate environment. It is highly likely that 2021 can be
seen as a floor, with net interest margin upside now available for
the Group. Not only does this allow for more predictable earnings
growth, it also provides customers with a transparent offering; a
clear point of differentiation in the market.
Overall, the strong underlying performance of our core Full and
Mid SIPPs led to net organic growth of 1.8% (calculated as organic
growth less attrition, divided by 2020 closing number of core
SIPPs) in 2021, despite delayed customer attrition during the year
due to COVID-19. We expect attrition to normalise in 2022, as it
did during the last three months of 2021, and the relaxation of
COVID-19 restrictions will further facilitate new business
gains.
Strong growth in core SIPP administration business
By the end of 2021, the number of SIPPs administered saw a 7.9%
gross organic increase of our core Full and Mid SIPPs, offset by
attrition of 6.1%.
The continued growth in our core product offering, Your Future
SIPP, continues to have a positive impact on the Group's organic
growth as well as on our relationships with advisers and
introducers.
The resulting increase in the total number of properties
administered by the Group rose to 9,065 and we expect further
growth based on a record number of enquiries in Q4 2021. The
Rivergate legal business has provided value adding services to our
customers during the year and was successful in trading as a proof
of concept driven by demand. We continue to explore options to
fast-track the evolution of Rivergate as the business is still in
its infancy.
Number of policies Full Mid SIPPs Total Full eSIPPs Third Party Total
SIPPs and Mid Administered
SIPPs
As at 31 December
2021 21,272 34,699 55,971 17,881 5,827 79,679
-------- ---------- ---------- -------- -------------- --------
As at 31 December
2020 23,013 31,985 54,998 20,742 6,484 82,224
-------- ---------- ---------- -------- -------------- --------
SIPPs added organically 914 3,415 4,329 236 24 4,589
-------- ---------- ---------- -------- -------------- --------
Conversions and
reclassifications (1,216) 1,216 - - - -
-------- ---------- ---------- -------- -------------- --------
SIPPs lost through
attrition (1,439) (1,917) (3,356) (3,097) (681) (7,134)
-------- ---------- ---------- -------- -------------- --------
Gross organic growth
rate 4.0% 10.7% 7.9% 1.1% 0.4% 5.6
-------- ---------- ---------- -------- -------------- --------
Annualised attrition
rate 6.3% 6.0% 6.1% 14.9% 10.5% 8.7%
-------- ---------- ---------- -------- -------------- --------
Industry backdrop
Whilst the last two years have seen broader market volatility,
the strength of the Curtis Banks business model has again shone
through with our fixed fee model delivering consistent revenue
generation. Curtis Banks' product proposition and breadth of
service enable us to provide superior choice and flexibility to the
needs of a retirement market that is having to deal with increasing
levels of macro-volatility.
Retail investment platforms continue to see significant in-flows
and Curtis Banks is rapidly developing a Digital Proposition that
sits alongside the classic retail platform solutions, providing
customers greater control of their portfolios at the higher end of
the market. During 2021, our average transfer to the group included
the consolidation of 2 existing pensions totalling an average
transfer value of over GBP465k, further reinforcing our strategy.
In 2021, 86% of all transfers came from retail platforms, further
evidencing the migration driven by asset values and product
complexity.
The pension market continued to be the focus of regulators
during 2021. The Curtis Banks business model adopts a very clear
approach in that we only work with regulated financial advisers and
we do not provide advice on investments held within our SIPPs. Our
fee structures also remain fair, transparent and competitive for
our target market and remains well positioned to withstand any
industry pressure on fee levels.
Integration of Talbot and Muir and Dunstan Thomas
The acquisitions of Talbot and Muir and Dunstan Thomas have been
further integrated into the Group and made a maiden full year
contribution in 2021. As evidenced by the strategic update
provided, both businesses underpin our transition to a more diverse
retirement group, providing multiple complementary solutions,
including FinTech, legal and property services to the advised
retirement market.
The additional scale from Talbot and Muir has enhanced the
operating margin across the pension administration segment.
The nature of Dunstan Thomas's FinTech business means that the
revenue stream is more volatile than that of pension
administration, with lower certainty on the timing of revenue
recognition on its customer contracts. Dunstan Thomas has perhaps
felt the impact of COVID-19 to a greater degree than the wider
business as some customers have chosen to slow or defer some
projects. While this is disappointing, we remain confident of the
medium and long term benefits this acquisition will bring. Dunstan
Thomas has improved the customer proposition offered by the Group
and broadened our customer base by introducing Fintech solutions
for wealth managers. This diversifies our revenue base, helps the
Group to reach a wider target market and pursue natural cross-sell
opportunities to our existing SIPP administration offering.
ESG Strategy - Promoting Fairness for Current and Future
Generations
The Group is pleased to publish its inaugural ESG Policy.
Following an independent materiality assessment of the Group, we
identified a number of opportunities to make a real difference in
addressing important issues to society, the economy and the
environment.
Key initiatives delivered in 2021 include:
-- Established a new partnership with The Intergenerational
Foundation to keep generations of families out of poverty and on
our platform for generations to come;
-- Engaged with our deposit taking counterparties to better
understand the use of the cash which is placed with them;
-- Undertook an initial analysis of our Commercial Property
holdings in pensions to understand the future climate risk;
-- Accreditation as an UK Living Wage Foundation employer. This
commitment applies not only to directly employed staff but also to
our third party contracted staff in recognition that life is hard
for working generations;
Plans for 2022:
-- Engage further with The Intergenerational Foundation to help
us review our products and services with the aim of adapting our
products and services to enable better Intergenerational
planning.
-- Further discussions with deposit takers to establish how cash
funds can be deployed to make an even bigger positive impact.
-- Delivery of unconscious bias in software training in our
Dunstan Thomas business - an industry first.
-- Pricing decisions on holding more environmentally friendly commercial properties in SIPPS.
-- ESG Data centre for the Group all in one place (i.e. adviser,
customer, employee satisfaction, carbon, financials)
We have established board level accountability for the Group's
ESG performance, overseen jointly by Jill Lucas, Non-executive
Director, and through my position as CEO. Progress on activities
will be reported at monthly Executive Committee meetings with
regular updates alongside the formal annual reporting cycle.
Outlook - Well positioned to execute medium-term growth
strategy
The Group is in a strong position to execute its medium-term
growth strategy and broaden its services in the advised pre and
post retirement market. We expect to report further growth from our
high-quality recurring fee revenue, with net organic growth
benefiting a return to more normal rates of customer attrition for
the core Full and Mid SIPPs. These rates had already reduced in
2021 from a high of 8.0% in June to 4.6% in December and into 2022
(4.9% in February 2022).
Given the opportunities arising from the core business and the
technology platform provided by Dunstan Thomas, the Board is
reviewing the scope to accelerate our growth initiatives. This
would enable us to streamline the business and enhance our customer
proposition while continuing to meet the increasing regulatory
burden, for example supporting the Pensions Dashboard initiative
and the FCA's proposals around Consumer Duty.
As a result of the Group's improved earnings quality and
visibility, coupled with its technology initiatives, the Board is
confident of meeting its stated growth objectives. Furthermore, the
combination of accelerated strategy implementation and organic
growth leaves the Group well positioned to achieve improvements in
operating margin ahead of current expectations.
Will Self
Chief Executive Officer
30 March 2022
Chief Financial Officer's Review
Results
A resilient financial performance for the year ended 31 December
2021 saw revenue increase by 18% to GBP63.3m (2020: GBP53.9m) and
statutory profit before tax improved by 22% to GBP9.3m (2020
restated: GBP7.6m). Diluted EPS on a statutory basis increased by
19% to 11.5p (2020 restated: 9.7p).
Adjusted profit before tax, which excludes items which do not
arise from our core operating activities, increased by 5% to
GBP14.0m (2020: GBP13.4m). We have previously referred to these
items as non-recurring items, as they arise principally from
acquisitions, restructuring and other one-off events. However, to
avoid any potential confusion that some may find in this term, we
have decided to now refer to adjusting items. Adjusted diluted EPS
was 6% lower at 16.9p (2020: 17.9p).
The robust financial performance in our core SIPP administration
activities was achieved against the persisting economic and
political challenges from both the UK's exit from the European
Union and the constant presence over the past 24 months of the
COVID-19 pandemic. As with many firms within our sector, the Group
has not been immune from the economic impact of these challenges,
but proactive changes in February 2021 to Curtis Banks's annual
pension administration fee model and a full year contribution from
Talbot and Muir has resulted in a 22% increase in fees to GBP45.1m
(2020: GBP36.9m).
The ongoing Russian invasion of Ukraine has led to an
unprecedented level of severe economic sanctions against the
Russian state, businesses and personnel. These exacerbated the
ongoing energy crisis grappling Europe and have wide knock-on
impacts on the global economy. We do not expect this to have a
significant impact on the Group's operations in the foreseeable
future because of the fixed fee nature of our SIPP revenue and the
lack of direct exposure from our existing suppliers and customers.
Management will continue to monitor the situation in case of any
new developments that might warrant a reassessment.
It remains our strong belief that the demonstrable growth in
fees which has been achieved is underpinned by the strength of our
core business model, which continues to generate strong levels of
recurring sterling fixed fees. Over the past 18 months the Group
has seen a marked reduction in sensitivity from interest income
which has also improved the quality of the Group's revenue.
The acquisition of Dunstan Thomas in 2020 introduced a new
revenue stream into the Group and was a further step in
crystallising the Group's objective towards greater
diversification. The 2021 Group results contain a full year
contribution from Dunstan Thomas for the first time and, despite a
very challenging calendar year, it successfully launched its Imago
Administration solution for SSAS pensions which provides
encouragement for 2022 revenue opportunities. 2021 also saw the
collaborative Group initiative under CB Labs launch a number of
solutions and adviser tools to provide more extensive support to
our intermediaries and customers.
The Group reports certain Alternative Performance Measures
("APMs") which we believe provides more clarity to stakeholders
over the Group's underlying performance and better enables them to
form a view on the Group's future prospects. The principal APMs
adopted are Adjusted Profit before Tax, Adjusted EPS and Adjusted
Operating Margin, and these will be discussed further below.
Adjusting items are classified as such when the nature and
quantum of the income or expense is significant and arises from a
business event or activity that does not form part of usual day to
day operations. Examples of such items include acquisitions,
including any subsequent re-measurement of contingent deferred
consideration and amortisation of intangible assets acquired,
office relocations and restructuring activities.
In addition, the Group has simplified its reported Statement of
Comprehensive Income by reverting to a statutory format only,
removing the 'non-recurring costs' adjustment column and other
non-statutory changes that were previously included. Our APMs are
now only disclosed within the front half of the financial
statements and a full reconciliation between these APMs and the
statutory measures will be disclosed within the CFO's report going
forward, with a strengthened focus and description of the key
reconciling items. The Group believe that this change is an
improvement to our financial disclosure and will facilitate a more
clear and transparent representation of our financial
performance.
The relevant reconciliation table is shown below for 2021 and
prior year comparatives:
GBP'000 2021 2020
Restated
Adjusted operating profit 14,905 13,986
Adjusted operating margin 23.5% 26.0%
Finance income 20 83
Interest expense (921) (697)
-------- ----------
Adjusted profit before tax 14,004 13,372
======== ==========
Adjusting items:
Dunstan Thomas acquisition costs (70) (769)
Talbot & Muir acquisition costs (63) (561)
Other M&A related costs (1,401) (136)*
Movement on contingent consideration relating 1,870 -
to acquisitions
Discount unwind on contingent consideration (879) (357)*
Redundancy & restructuring costs (626) (1,091)
In-specie contributions 76 (402)
Centralisation of pension administration system (322) -
Treasury solution implementation (45) (286)
Data cleansing provision (288) (53)
Adjusting items (1,748) (3,655)
------------------------------------------------- -------- ----------
Impairment on customer portfolios - (344)
Intangible asset amortisation (2,934) (1,744)**
-------- ----------
IFRS Profit before tax 9,322 7,629
======== ==========
Taxation (1,603) (1,732)
-------- ----------
Profit after tax 7,719 5,897
======== ==========
Adjusted EPS
Basic 17.1 18.1
Diluted 16.9 17.9
*Measurement period restatements of GBP15k decrease in other
acquisition related costs, GBP169k increase in discount unwind, and
GBP354k decrease in amortisation.
Revenue
Revenues of GBP63.3m in 2021 (2020: GBP53.9m) represent an 18%
year on year increase, driven primarily by the full-year
contributions from Dunstan Thomas and Talbot and Muir, as well as
the increased annual SIPP administration fees applied on our core
Full and Mid SIPPs.
Fee revenue from SIPP products remains the overwhelming source
of income for the Group with 88% of these fees being recurring
fixed annual fees (2020: 86%). These annual fees are subject to
annual contractual inflationary increases referenced to average
weekly earnings. Additional fixed fees are charged depending on the
transactional services provided for each of the products and these
are also subject to the same annual inflationary increases.
All SIPP fees levied are fixed sterling charges and are not
dependent on the value of the underlying assets held within the
SIPP. As a result, the revenues generated by both Curtis Banks and
Talbot and Muir are insulated from the movements in financial
markets and/or commercial property values and are therefore subject
to less volatility than many of our peers who operate a basis point
charging structure which is driven by the underlying asset value
held within a SIPP. We view this as a key differential that sets us
apart from most of our competitors and provides an attractively
priced product with better clarity and certainty, especially in
respect to higher value SIPPs. As such, where the underlying value
of a SIPP increases our product offering becomes increasingly
affordable. In the meantime, the exposure to the volatility of
financial markets is reduced compared to our competitors.
In the year ended 31 December 2021, GBP8.3m of the Group revenue
was generated from interest margin (2020: GBP12.2m), with the
proportion of contribution to total revenue falling to 13% from 23%
in the previous year. Interest income from client money held
includes amounts earned through the use of pooled banking
arrangements. In the year ended 31 December 2021, a net interest
margin of 0.80% (2020: 1.12%) was generated from client money held
within pooled banking arrangements, despite the low interest
environment which persisted for most of the financial year and into
2022. However, the Group is well positioned to benefit from a
rising interest rate environment in 2022. A combination of the
transparent interest sharing model introduced in February 2021 and
the current yield curve presents considerable upside for the Group,
particularly in 2023.
When we implemented the change to Curtis Banks's annual SIPP
administration fees, effective from 1 February 2021, we also
announced that the amount of interest paid to customers would no
longer be set on a discretionary basis. The Group believes that its
clear commitment to sharing interest generated with our customers
is fairer, more transparent and provides greater certainty to those
customers. The way in which we share interest with our customers
can is explained at https://www.curtisbanks.co.uk/bankinterest/.
The amount of interest generated by the Group, and the amount
shared with our customers, is monitored by the Group Assets and
Liabilities Committee under its established Treasury Framework
model.
GBP9.9m (2020: GBP4.8m) of revenue was generated from Fintech
services. The net increase year on year was driven by the full year
contribution in 2021 and partly offset by headwind experienced by
Dunstan Thomas as a result of the COVID-19 pandemic.
Expenses
The year ended 31 December 2021 saw administrative expenses
increase by 16% to GBP52.2m from GBP44.9m, impacted from the full
year cost from Dunstan Thomas and Talbot and Muir.
Staff costs for the year increased by 17% to GBP30.5m (2020:
GBP26.1m) and were influenced by salary inflation, referenced to
average weekly earnings, and the full year impact from the
acquisitions of Dunstan Thomas of GBP7.1m (2020: GBP1.9m) and
Talbot and Muir of GBP2.7m (2020: GBP0.4m).
Staff costs continue to reflect the cost of share based payment
awards under the Group's Long Term Incentive Plans and Save As You
Earn ("SAYE") schemes, as well as the commitment to the auto
enrolment of staff pension contributions. These measures continue
to reflect the importance of staff satisfaction to the Group and
contribute not only to improved levels of key staff engagement and
retention but also drive the provision of desired service levels to
customers which are demanded by our introducers of business. We
continue to review the manner in which we reward staff performance
and we are delighted that since the appointment of Jaynie Vincent,
as Group People Officer, the Group has received accreditation as a
Living Wage Employer.
Average staff numbers increased to 828 (2020: 698), primarily as
a result of the Group's acquisition of Talbot and Muir and Dunstan
Thomas in 2020.
The other material cash outflow that the Group incurs is in
respect of IT and in 2021 this amounted to GBP4.7m (2020: GBP3.5m).
This reflects not only the cost of supporting the core IT
infrastructure across the Group's multiple office locations but
also the amount of investment in technological improvements to the
SIPP administration platform and the programme of these
improvements is expected to continue into 2024. As previously
announced, the Group is implementing a strategic system change
which will see the upgrade of the existing Navision platform used
by the majority of the Group and the subsequent migration of SIPPs
administered on other platforms used within the Group onto this
upgraded Navision administration platform. By 2024, this is
anticipated to yield annual cost savings of GBP1.2m.
The cost of undertaking regulated activities continues to
increase and for the year ended 31 December 2021 the Group's cost
increased to GBP2.1m (2020: GBP1.7m) from the combination of
regulatory fees, levies and insurance. The Group considers this
cost to be largely uncontrollable in nature.
Finance costs relating to interest payable on banking facilities
increased by GBP0.2m year on year following the re-negotiated
credit facilities with Santander to finance the acquisition of
Dunstan Thomas. Borrowings continue to be repaid in line with the
scheduled terms and the covenants required by the bank are well
covered. Interest on the debt during the year accrued at a rate of
2.25% over the London Interbank Offered Rate ("LIBOR"). LIBOR was
replaced by the Sterling Overnight Indexed Average ("SONIA") on 1
January 2022 and our credit facilities are now benchmarked against
this rate.
The Group continues to take steps to improve its adjusted
operating margin through a combination of revenue enhancements and
operational efficiencies, balanced with continued investment back
into the business and the provision of a high quality service to
our customers. The adjusted operating margin has decreased during
the year, impacted by the increase in non-controllable regulatory
costs and more materially by the pressure that the low interest
environment has had on interest income. The Group has sought to
mitigate its sensitivity to interest income through an increase in
annual fees on Full and Mid SIPPs which were effective 1 February
2021 and a full year's benefit of these increases will be enjoyed
in 2022.
Adjusting Items
As outlined above, 'Adjusting Items' are classified as such when
the nature and quantum of the income or expense is significant and
arises from a business event or activity that does not form part of
usual day to day operations. Examples of such items include
acquisitions, office relocations and restructuring activities.
Adjusting items for the year can be broadly categorised into
several core elements.
Acquisition related items
Costs of GBP133,000 (2020: GBP1,330,000) associated with the
acquisitions of Dunstan Thomas and Talbot and Muir, were recognised
during the financial year as outside of the operating cost base of
the Group. In addition to these costs, a net credit of GBP991,000
(2020: debit of GBP357,000) was recognised in respect of movements
in the deferred consideration payable (GBP1.9m reduction) and the
discount unwind (GBP0.9m expense) associated with the acquisitions
of Dunstan Thomas and Talbot and Muir. The considerations are
contingent of the business performance post acquisition and the
underperformances in Dunstan Thomas in the year led to the
reduction of the liability. Further movements in both the aggregate
amount of deferred consideration payable and the unwind of discount
associated with each acquisition are expected to recognised in the
current financial year ahead of the conclusion of earn out period
provisions.
Other M&A related costs of GBP1,401,000 (2020: GBP136,000)
relate primarily to costs associated with a corporate transaction
which did not subsequently proceed during the period. The
transaction was potentially transformational for both parties, the
partner operating in a similar market to Group, and demonstrates
the Board's ambition for growth. The costs incurred reflect the
external advice received on the proposed transaction and no further
costs are expected to be incurred in relation to this in the
financial year ending 31 December 2022.
Redundancy and restructuring costs
During the year ended 31 December 2021, the Group progressed its
strategy to deliver its Target Operating Model through the
centralisation of its commercial property administration within one
office location. Redundancy costs associated with this
centralisation process, as well as costs associated with duplicated
staff efforts while work was transferred between offices, totalled
GBP626,000 in the year ended 31 December 2021 (2020: GBP1,091,000).
No further costs are expected to be incurred in relation to the
centralisation of commercial property administration in the current
financial year.
In-specie contributions
As has been widely reported in the wider industry press, HMRC
has challenged all SIPP providers on whether pension contributions
could be made in-specie. The Group has been in correspondence with
HMRC regarding processes and documentation in respect of in-specie
contributions for some time. In the year ended 31 December 2020,
following a favourable outcome for HMRC in an appeal against the
First-Tier Tribunal's ruling in favour of another SIPP operator in
a similar case, and with further legal advice, the Group considered
it more likely than not that some cost associated with this
liability would be borne by the Group and had recognised a
provision of GBP402,000 to reflect this. In the year ended 31
December 2021, the Group continued to assess the liability and has
revised the provision to GBP320,000.
As referenced earlier in my report, the Group is implementing
its articulated strategy to transition its entire SIPP
administration onto a single administration platform, paving the
way to deliver our Target Operating Model and the accompanying
efficiencies. The first phase of the strategy, being the
development and construction of a new digital portal, has already
been delivered in partnership with Dunstan Thomas. The next phase,
which is currently underway, will see the current Navision platform
which supports the majority of the Group's SIPPs upgraded to the
Navision Business Central platform. Once this upgrade has been
completed, the Group will be in a position for all of the SIPPs
held on other administration platforms to be migrated onto the
upgraded Navision Business Central platform. Once this has been
completed the Group anticipates annual cost savings of at least
GBP1.2m and, as importantly, will provide the Group with the
opportunity to implement its Target Operating Model based on this
common technology.
Treasury solution implementation
During 2020, the Group invested in a new strategic treasury
solution with a global provider of back office operational cash
management software. The investment was designed to innovate and
improve the Group's treasury management function through the
provision of a system that provides a multibank facility and
further enhancements to this system which supports the virtual
pooling of customer cash has resulted in a further charge of
GBP45,000 in the year ended 31 December 2021 (2020: GBP286,000). No
further costs are currently anticipated in relation to the system
during the current financial year.
Data cleansing provision
Up until the current year ended 31 December 2021, a contingent
liability was held in relation to the data cleansing exercise with
an estimated value of GBP1,400,000. Management now consider that
the contingent liability is no longer applicable but that a
probable provision of GBP211,000 is required to settle remaining
costs as at 31 December 2021.
Amortisation and impairment of intangible assets
Amortisation of the Group's intangible assets represented a
charge of GBP2,933,000 for the period. We had not taken any
impairment charges against the value of any SIPP portfolios
recognised within intangible assets (2020: GBP344,000).
Cash flows
Shareholder cash balances at year end were GBP31.9m compared to
GBP32.5m at the end of the previous financial year.
Net cash inflows from shareholder operating activities for the
period were GBP14.3m (2020: GBP7.7m net cash inflow), with the
increase in cash generation primarily attributable to improvements
in working capital management.
A combination of the investment in intangible assets, equity
dividends paid and repayment of borrowings during the year saw
significant net cash outflows from investing and financing
activities.
Suffolk Life Annuities
Part of the Suffolk Life Group of Companies, Suffolk Life
Annuities Limited, is an insurance company that writes SIPP
Products as insurance contracts. These are all non-participating
investment contracts and so the Group does not bear any insurance
risk. As the policyholder assets and liabilities are shown on the
balance sheet of Suffolk Life Annuities Limited, these also show on
the Group balance sheet on consolidation. Assets in the SIPPs
administered by the rest of the Group are held in trust and not
under insurance contracts and therefore do not need to be included
on the balance sheet. As the policies are non-participating
contracts, the customer related assets and liabilities in Suffolk
Life Annuities Limited match. In addition the revenues, expenses
and investment returns of the non-participating investment
contracts are shown in the consolidated statement of comprehensive
income. Again, these income, expense items and investment returns
due to the policyholders are completely matched. An illustrative
balance sheet as at 31 December 2021 showing the financial position
of the Group excluding the policyholder assets and liabilities is
included as supplementary unaudited information after the notes to
the financial statements. An illustrative cash flow on the same
basis has also been provided.
Employee Benefit Trust ("EBT")
The EBT continues to be used to acquire shares in the Group in
the open market to satisfy future vesting of options and long term
incentive awards. The EBT is funded by loans from the Group. As at
31 December 2021, the EBT held 488,296 shares in Curtis Banks Group
PLC (2020: 261,276). A number of options awarded under the
Company's SAYE schemes vested during the year and awards were made
from the shares held by the EBT.
The financial statements of the EBT are consolidated within the
overall Group financial statements and these shares are shown on
the balance sheet of the Group as Treasury Shares and are included
within total equity.
Capital requirements
The Group's four (2020: four) regulated subsidiary companies
submit regular returns to the FCA and the PRA relating to their
capital resources. At 31 December 2021 the total regulatory capital
requirement across the Group was GBP15.1m (2020: GBP15.2m) and the
Group had an aggregate surplus of GBP17.0m (2020: GBP17.2m) across
all regulated entities. In addition to this, it is Group internal
policy for regulated companies within the Group to hold at least
130% of their required regulatory capital and this has been
maintained throughout the year.
Three (2020: three) of the principal trading subsidiaries of the
Group are regulated by the FCA and are subject to the relevant
capital adequacy rules. The fourth (2020: fourth) regulated entity
Suffolk Life Annuities Limited ("SLA"), being an insurance company,
is subject to Solvency II rules and it's capital requirement is
determined by the Standard Formula as set out in the Solvency II
directives.
Full details of SLA's capital position are set out in the
Solvency and Financial Condition Report published annually on the
Group's website.
Financial Position
The Group increased net assets by 1.7% to GBP81.6m as at 31
December 2021 (2020: GBP80.2m), and reduced shareholder cash
reserves slightly from GBP32.5m to GBP31.9m over the same
period.
As at 31 December 2021, the Group had net shareholder cash
(after debt) of GBP12.0m (2020: GBP8.8m).
The Group adopted the provisions of IFRS 16, accounting for
leases, for the accounting period commencing 1 January 2019. The
effect of this on our financial performance is not material
although the impact on the Group's balance sheet has been to
increase Non-current assets and Current/Non-current liabilities. It
should be noted that our principal lenders exclude the impact of
IFRS 16 when calculating our banking covenants. We have also
received confirmation previously from the FCA that the provisions
of IFRS 16 do not need to be taken into account in our regulatory
capital calculations.
Outlook
The Group's profitability is not directly linked to market
performance and therefore the growth in our SIPP numbers provides
more visibility and less volatility of earnings, combined with
discipline over our controllable cost base. In 2022, we expect the
combination of SIPP revenue growth, improved performance by Dunstan
Thomas and a positive impact on the Group's interest revenue
following recent changes, to materially improve top line growth,
and we will maintain careful cost discipline whilst supporting
investment in our stated growth strategies.
Dan Cowland
Chief Financial Officer
30 March 2022
Consolidated statement of comprehensive income
Year ended Year ended
31 December 31 December
2021 2020 - As
restated*
Total Total
Notes GBP'000 GBP'000
Revenue 2 63,307 53,871
Administrative expenses (52,205) (44,942)
Impairment on customer
portfolios - (344)
Policyholder investment
returns 466,811 125,231
Non-participating investment
contract expenses (33,850) (35,343)
Changes in provisions:
Non-participating investment
contract liabilities (432,961) (89,888)
---------- ---------
Policyholder total - -
Operating profit 11,102 8,585
Finance income 20 83
Finance costs 6 (1,800) (1,039)
-------- --------
Profit before tax 9,322 7,629
Taxation 7 (1,603) (1,732)
-------- --------
Total comprehensive income for the
year 7,719 5,897
======== ========
Attributable to:
Equity holders of the
company 7,723 5,897
Non-controlling interests (4) -
-------- --------
7,719 5,897
======== ========
Earnings per ordinary
share on net profit
Basic (pence) 8 11.6 9.9
Diluted (pence) 8 11.5 9.7
The consolidated statement of comprehensive income has been
prepared on the basis that all operations are continuing
operations.
*The audited results for year ended 31 December 2020 have been
restated to account for measurement period adjustments arising
under IFRS 3 Business Combinations relating to the acquisitions of
the Dunstan Thomas Group and the Talbot and Muir Group that took
place in H2 2020. The changes impact administrative expenses and
tax only.
Consolidated statement of financial position
Group
Group Notes As restated*
As at As at
31-Dec-21 31-Dec-20
GBP'000 GBP'000
ASSETS
Non-current assets
Intangible assets 9 89,814 91,078
Investment property 1,316,468 1,208,605
Property, plant and equipment 10 8,636 7,658
Investments 2,224,965 2,072,317
3,639,883 3,379,658
------------ -------------
Current assets
Trade and other receivables 27,981 26,649
Cash and cash equivalents 11 410,133 430,578
Current tax asset 957 581
------------ -------------
439,071 457,808
------------ -------------
Total assets 4,078,954 3,837,466
------------ -------------
LIABILITIES
Current liabilities
Trade and other payables 20,853 18,895
Deferred income 29,960 26,995
Borrowings 12 46,832 53,533
Lease liabilities 964 672
Provisions 13 453 501
Contingent consideration 15 2,467 2,375
101,529 102,971
------------ -------------
Non-current liabilities
Borrowings 12 43,957 53,370
Lease liabilities 6,774 5,201
Provisions 13 178 7
Contingent consideration 15 5,199 6,537
Non-participating investment
contract liabilities 3,836,211 3,585,307
Deferred tax liability 3,464 3,790
------------ -------------
3,895,783 3,654,212
------------ -------------
Total liabilities 3,997,312 3,757,183
------------ -------------
Net assets 81,642 80,283
------------ -------------
Equity attributable to owners
of the parent
Issued capital 332 330
Share premium 58,087 57,799
Equity share based payments 2,840 2,747
Treasury shares (1,382) (741)
Retained earnings 21,755 20,134
------------ -------------
81,632 80,269
Non-controlling interest 10 14
Total equity 81,642 80,283
------------ -------------
*The audited results for year ended 31 December 2020 have been
restated to account for measurement period adjustments arising
under IFRS 3 Business Combinations relating to the acquisitions of
the Dunstan Thomas Group and the Talbot and Muir Group that took
place in H2 2020. The changes impact intangible assets, trade and
other receivables, contingent consideration, and deferred tax
liability.
Consolidated statement of changes in equity
Equity Non-controlling
Issued Share share Treasury Retained interest Total
capital premium based shares earnings* Total* GBP'000 Equity*
GBP'000 GBP'000 payments GBP'000 GBP'000 GBP'000 GBP'000
GBP'000
At 1 January
2020 271 33,659 2,313 (534) 19,730 55,439 14 55,453
Total
comprehensive
income
for the year* - - - - 5,898 5,898 - 5,898
Share based
payments - - 434 - - 434 - 434
Ordinary
shares bought
and
sold by EBT - - - (207) - (207) - (207)
Ordinary
shares issued 59 24,140 - - - 24,199 - 24,199
Deferred tax
on share
based
payments - - - - (345) (345) - (345)
Ordinary
dividends
declared
and paid - - - - (5,149) (5,149) - (5,149)
At 31 December
2020 - As
restated* 330 57,799 2,747 (741) 20,134 80,269 14 80,283
Total
comprehensive
income
for the year - - - - 7,723 7,723 (4) 7,719
Share based
payments - - 93 - - 93 - 93
Ordinary
shares bought
and
sold by EBT - - - (641) - (641) - (641)
Ordinary
shares issued 2 288 - - - 290 - 290
Deferred tax
on share
based
payments - - - - (105) (105) - (105)
Ordinary
dividends
declared
and paid - - - - (5,997) (5,997) - (5,997)
At 31 December
2021 332 58,087 2,840 (1,382) 21,755 81,632 10 81,642
========= ========= ========= ========== =========== ========= ================ =========
*The audited results for year ended 31 December 2020 have been
restated to account for measurement period adjustments arising
under IFRS 3 Business Combinations relating to the acquisitions of
the Dunstan Thomas Group and the Talbot and Muir Group that took
place in H2 2020.
Consolidated statement of cashflows
Group
Year ended 31 December
As restated*
2021 2020
GBP'000 GBP'000
Cash flows from operating activities
Profit before tax 9,322 7,629
Adjustments for:
Depreciation 1,806 1,499
Amortisation and impairments 2,934 2,088
Finance costs 1,800 697
Share based payment expense 93 434
Fair value gains on movement in contingent consideration (1,870) -
Fair value gains on financial investments (213,701) (119,957)
Additions of financial investments (647,479) (631,200)
Disposals of financial investments 708,532 673,037
Fair value (gains)/losses on investment properties (120,416) 60,751
Increase in liability for investment contracts 250,904 13,403
Changes in working capital:
Increase in trade and other receivables (1,330) (2,737)
Increase/(decrease) in trade and other payables 5,017 (1,105)
Taxes paid (2,410) (2,996)
Net cash flows (used in) / from operating activities (6,798) 1,543
---------- -------------
Cash flows from investing activities
Payments for intangible assets (1,670) (986)
Purchase of property, plant and equipment (270) (591)
Purchase of investment property (92,456) (122,449)
Purchase and sale of shares in the Group by the EBT (641) (207)
Receipts from sale of investment property 105,009 118,877
Net cash flows from acquisitions (255) (34,484)
Net cash flows received from / (used in) in investing activities 9,717 (39,840)
---------- -------------
Cash flows from financing activities
Equity dividends paid (5,997) (5,149)
Net proceeds from issue of ordinary shares 290 24,199
Net (decrease)/increase in borrowings (16,114) 29,595
Principal elements of lease payments (762) (934)
Interest paid (781) (383)
Net cash (used in)/received from financing activities (23,364) 47,328
---------- -------------
Net (decrease) / increase in cash and cash equivalents (20,445) 9,031
---------- -------------
Cash and cash equivalents at the beginning of the year 430,578 421,547
========== =============
Cash and cash equivalents at the end of the year 410,133 430,578
========== =============
*The audited results for year ended 31 December 2020 have been
restated to account for measurement period adjustments arising
under IFRS 3 Business Combinations relating to the acquisitions of
the Dunstan Thomas Group and the Talbot and Muir Group that took
place in H2 2020.
1 Corporate information
Curtis Banks Group PLC ("the Company") is a public limited
company incorporated and domiciled in England and Wales, whose
shares are publicly traded on the AIM market of the London Stock
Exchange PLC.
At 31 December 2021 the Group administered circa GBP37.4bn
(2020: GBP32.4bn) of pension assets on behalf of over 80,000 (2020:
82,000) active customers. More than 800 staff are employed across
its head office in Bristol and regional offices in Ipswich, Dundee,
Portsmouth, Nottingham and Leeds.
The Executive Directors have proven experience in the retail
savings, pensions and wealth markets and have established a
business that focuses on a service-driven proposition for the
administration of flexible SIPPs. The Group's core pension products
are primarily distributed by authorised and regulated financial
advisers, targeted towards pension savers who wish to take full
advantage of the features and flexibility offered in the UK's
modern and changing pension regime. Long standing relationships
with key distributors result in high levels of repeat business and
demonstrate satisfaction with products and services provided.
The Group is focussed on continuing to deliver value to both
customers and shareholders in the years ahead.
Note: The Group includes an insurance company, Suffolk Life
Annuities Limited, which provides SIPPs through non-participating
individual insurance contracts. Due to Suffolk Life Annuities
Limited's status as an insurance company, the consolidated results
for the whole Group are required to include insurance policyholder
assets and liabilities as well as the assets and liabilities and
profits attributable to our shareholders. Notes 16 and 17 to this
Announcement illustrate the split between policyholder and
shareholder assets and liabilities and cash flows.
2 Revenue
Revenue is wholly derived from activities undertaken within the
United Kingdom and comprises the following categories:
Year ended 31 December
2021 2020
GBP'000 GBP'000
Pension administration fees 45,091 36,856
FinTech services 9,900 4,793
Interest income 8,316 12,222
63,307 53,871
============== ==============
3 Profit for the year
Profit for the year is arrived at after charging:
Year ended 31 December
2021 2020
GBP'000 GBP'000
Amortisation and impairment of
intangible assets 2,933 2,442
Depreciation of property, plant
and equipment 1,806 1,499
Auditors' remuneration:
- audit of the company and consolidated
financial statements 227 177
- audit of the financial statements
of the subsidiaries 397 314
- audit related assurance services 40 37
4 Operating segment reporting
The following tables present revenue and profit information
regarding the Group's operating segments for the two years ended 31
December 2021 and 31 December 2020 respectively.
Pension Administration Consolidation
GBP'000 FinTech adjustments Consolidated
Year ended 31 December GBP'000 GBP'000 GBP'000
2021
Revenue
External customers 53,407 9,900 - 63,307
Internal customers - 1,349 (1,349) -
----------------------- ---------- -------------- ---------------
53,407 11,249 (1,349) 63,307
----------------------- ---------- -------------- ---------------
Administrative expenses
External customers 43,866 8,339 - 52,205
Internal customers 813 390 (1,203) -
----------------------- ---------- -------------- ---------------
44,679 8,729 (1,203) 52,205
----------------------- ---------- -------------- ---------------
Operating profit 8,728 2,520 (146) 11,102
Pension FinTech Consolidation
Administration adjustments Consolidated
Year ended 31 December GBP'000 GBP'000 GBP'000 GBP'000
2020
Revenue
External customers 49,078 4,793 - 53,871
Internal customers - 485 (485) -
---------------- ---------
49,078 5,278 (485) 53,871
---------------- --------- -------------- ---------------
Administrative expenses
External customers 42,231 3,055 - 45,286
Internal customers - 485 (485) -
---------------- ---------
42,231 3,540 (485) 45,286
---------------- --------- -------------- ---------------
Operating profit 6,847 1,738 - 8,585
Corporate costs
The Group's operating segments are managed together as one
business. Accordingly, certain corporate costs such as finance
income and expenses, adjusting items, gains and losses on the
disposal of assets, taxes, intangible assets and certain other
assets and liabilities are not allocated to individual segments as
they are managed on a group basis. Segment adjusted operating
profit or loss reflects the measure of segment performance reviewed
by the Board of Directors (the Chief Operating Decision Maker).
The following table presents a split of assets and liabilities
of the Group's operating segments for the year ended 31 December
2021.
Corporate assets and liabilities are not allocated to individual
operating segments as they are managed on a group basis.
Policyholder assets and liabilities are not allocated to individual
operating segments as all investment returns associated with these
are due back to policyholders under non-participating investment
contracts, alongside non-participating investment contract expenses
and changes in provisions for non-participating investment contract
liabilities, such that the impact on shareholder assets and
liabilities, and profit or loss, is nil.
Year ended Pension Administration
31 December GBP'000 FinTech Corporate Policyholder Consolidated
2021 GBP'000 GBP'000 GBP'000 GBP'000
Total
assets 65,960 9,508 70,853 3,932,633 4,078,954
Total
liabilities 32,793 3,113 28,773 3,932,633 3,997,312
5 Directors and employees
Year ended 31 December
2021 2020
GBP'000 GBP'000
Wages and salaries 25,189 21,317
Social security costs 2,644 2,301
Other pension costs 2,327 2,015
Share-based incentive awards 364 434
------------------------------- -------------------------------
30,524 26,067
=============================== ===============================
2021 2020
The monthly average number of employees Number Number
during
the year was:
Directors 7 6
Administration 821 692
828 698
=============================== ===============================
Details of emoluments paid to the directors and key management
personnel of the Group are as follows:
Year ended 31 December
2021 2020
GBP'000 GBP'000
Total emoluments paid to:
Directors
Wages and salaries 1,354 1,487
Social security costs 162 220
Post-employment costs 14 20
Share-based incentive awards 80 202
Other key management personnel
Wages and salaries 1,005 908
Compensation for loss of office 62 -
Social security costs 129 136
Post-employment costs 69 60
Share-based incentive awards 2 80
------------------------------- -------------------------------
2,877 3,113
=============================== ===============================
Emoluments of highest paid director:
Wages and salaries 429 508
Pension contribution 6 7
------------------------------- -------------------------------
435 515
=============================== ===============================
Short term employee benefits include wages and salaries. Long
term employee benefits include share-based incentive awards.
6 Finance costs
Year ended 31 December
2021 2020
GBP'000 GBP'000
Interest payable on bank loans 702 523
Interest and finance costs on lease
liabilities 209 174
Other interest expense 10 -
Total interest expense 921 697
Unwind of discount on contingent consideration
relating to:
Acquisition of Dunstan Thomas 364 131
Acquisition of Talbot and Muir 515 57
Total finance costs 1,800 885
============================= =============================
7 Taxation
Year ended 31 December
2021 2020
GBP'000 GBP'000
Domestic current year tax
UK Corporation tax 1,996 1,542
Deferred tax
Origination and reversal of temporary
differences (393) 122
1,603 1,664
============================= =============================
Factors affecting the tax charge for
the year
Profit before tax 9,322 7,429
============================= =============================
Profit before tax multiplied by standard
rate of UK Corporation tax of 19%
(2020: 19%) 1,771 1,412
----------------------------- -----------------------------
Effects of:
Adjustment to prior year 121 117
Non-deductible expenses 93 177
Other tax adjustments (382) (42)
----------------------------- -----------------------------
(168) 252
Total tax charge 1,603 1,664
============================= =============================
8 Earnings per share
Basic earnings per share amounts are calculated by dividing net
profit for the year attributable to equity holders of the Company
by the weighted average number of ordinary shares outstanding
during the year.
Diluted earnings per share amounts are calculated by dividing
the net profit attributable to ordinary equity holders of the
Company by the weighted average number of ordinary shares
outstanding during the year plus the weighted average number of
ordinary shares that would be issued on the conversion of all the
dilutive potential ordinary shares into ordinary shares.
Changes in income or expense that would result from the
conversion of the dilutive potential ordinary shares are deemed to
be trivial, and therefore no separate diluted net profit is
presented.
The following reflects the income and share data used in the
basic and diluted earnings per share computations:
As restated*
2021 2020
GBP'000 GBP'000
Net profit available to equity holders of
the Company 7,723 5,897
================= =============
Number Number
Weighted average number of ordinary shares:
Issued ordinary shares at start of the
year 66,414,312 54,142,346
Effect of shares issued during the year 333,781 5,859,094
Effect of shares held by employee benefit
trust (316,688) (296,835)
Basic weighted average number of shares 66,431,405 59,704,605
Effect of dilutive options 510,602 886,707
Diluted weighted average number of shares 66,942,007 60,591,312
================= =============
Pence Pence
Earnings per share:
Basic 11.6 9.9
Diluted 11.5 9.7
*The audited results for year ended 31 December 2020 have been
restated to account for measurement period adjustments arising
under IFRS 3 Business Combinations relating to the acquisitions of
the Dunstan Thomas Group and the Talbot and Muir Group that took
place in H2 2020.
9 Intangible assets
Group
Internally
Customer Computer Generated
Goodwill Brand Portfolios Software Software Total
GBP'000 GBP'000s GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 January
2020 28,903 - 18,866 2,177 - 49,946
Arising on
acquisitions* 26,829 1,595 14,939 - 5,390 48,753
Additions - - - 606 380 986
At 31 December
2020 55,732 1,595 33,805 2,783 5,770 99,685
Arising on - - - - - -
acquisitions
Additions - - - 492 1,178 1,670
At 31 December
2021 55,732 1,595 33,805 3,275 6,948 101,355
----------- ----------- ------------- ----------- ----------- ----------
Amortisation and Impairment
At 1 January
2020 - - 5,320 1,199 - 6,519
Charge for
the year* - 66 1,190 248 240 1,744
Impairment - - 344 - - 344
At 31 December
2020 - 66 6,854 1,447 240 8,607
Charge for
the year - 160 1,878 264 632 2,934
At 31 December
2021 - 226 8,732 1,711 872 11,541
----------- ----------- ------------- ----------- ----------- ----------
Net book
value
At 1 January
2020 28,903 - 13,546 978 - 43,427
=========== =========== ============= =========== =========== ==========
At 31 December
2020 - As
restated* 55,732 1,529 26,951 1,336 5,530 91,078
=========== =========== ============= =========== =========== ==========
At 31 December
2021 55,732 1,369 25,073 1,564 6,076 89,814
=========== =========== ============= =========== =========== ==========
Goodwill
Goodwill totalling GBP28,903,000 arose on the acquisition of
Suffolk Life Group Limited and its subsidiaries on 25 May 2016.
Goodwill totalling GBP17,075,000 arose on the acquisition of
Dunstan Thomas Group Limited and its subsidiaries on 3 August 2020.
Goodwill totalling GBP9,754,000 arose on the acquisition of Talbot
and Muir Limited and its subsidiaries on 30 October 2020.
The Group tests goodwill for impairment annually or more
frequently if there are indications that goodwill might be
impaired. The recoverable amount of goodwill has been determined
based on value-in-use calculations using a discount rate
appropriate to the risk profile of the asset. These calculations
use operating cash flow projections based on financial budget &
forecast approved by management covering a three year period,
assuming business then continues onwards after this period at a
steady rate for the purpose of the analysis. No impairment was
identified and sensitivity analysis was performed.
Customer Portfolios
Represent individual customer portfolios acquired through
business combinations and accounted for under the acquisition
method. The directors consider that there is no impairment to
assets as at the year-end (2020: GBP344,000). The customer
portfolios are being amortised over a period of 20 years.
The brought forward balance relates to the purchase by Curtis
Banks Limited, a subsidiary company, of the trade and assets of
Montpelier Pension Administration Services Limited on 13 May 2011,
the full SIPP business of Alliance Trust Savings Limited on 18
January 2013, the full SIPP business and certain assets of Pointon
York SIPP Solutions Limited on 31 October 2014, the full SIPP
business of Rathbones Pension & Advisory Services Limited on 31
December 2014, a book of full SIPPs from Friends Life PLC (now
Aviva PLC) on 13 March 2015 and a book of SIPPs from Hargreave Hale
Limited on 10 December 2018.
The brought forward balance also includes the purchase by
Suffolk Life Pensions Limited, a subsidiary company, of the trade
and assets of European Pensions Management Limited on 14 July 2016,
and books of SIPPs purchased from Pointon York SIPP Solutions
Limited on 9 November 2012, Pearson Jones PLC on 30 April 2013, and
Origen Investment Services Limited on 22 May 2013.
Lastly, the brought forward balance includes customer portfolios
fair valued at GBP11,229,000 which arose on acquisition of Talbot
and Muir Limited and its subsidiaries on 30 October 2020.
Computer Software
Computer software comprises costs that meet the recognition
criteria under IAS 38 as Intangible Assets. General small computer
software costs are amortised over their useful economic life of
four years on a straight-line basis. Computer software costs for
significant projects are amortised over an estimated UEL on a
project by project basis.
Internally Generated Software
Internally generated software represents the value of principal
software products owned and licensed by Dunstan Thomas. The asset
includes both value arising on acquisition of Dunstan Thomas during
the year ended 31 December 2020, and further development of the
asset since. Internally generated software is being amortised over
a period of 10 years.
Brand
Brand comprises the value of the Dunstan Thomas brand, which was
obtained following acquisition of Dunstan Thomas during the year
ended 31 December 2020. Dunstan Thomas has been established in the
UK for over 30 years and has a strong market presence. The Group
operates Dunstan Thomas as an independent brand. The value of the
brand was assessed at acquisition and is being amortised over 10
years.
Research and development
The amount of research and development expenditure recognised as
an expense is nil (2020: nil).
10 Property, plant and equipment
Assets held at cost
Group
Computer Office Total
Right equipment equipment,
of use fixtures &
assets fittings
GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 January 2020 5,285 5,083 1,626 11,994
Arising from acquisitions 1,904 292 468 2,664
Additions - 570 21 591
At 31 December 2020 7,189 5,945 2,115 15,249
Additions 2,627 265 5 2,897
Disposals (579) - (81) (660)
At 31 December 2021 9,237 6,210 2,039 17,486
------------------- ------------------- --------------------- ------------------
Depreciation
At 1 January 2020 695 3,842 1,262 5,799
Arising from acquisitions - 180 113 293
Charge for the year 763 547 189 1,499
At 31 December 2020 1,458 4,569 1,564 7,591
Arising from acquisitions - (14) 14 -
Charge for the year 944 611 251 1,806
Disposals (469) - (78) (547)
At 31 December 2021 1,933 5,166 1,751 8,850
------------------- ------------------- --------------------- ------------------
Carrying value
At 1 January 2020 4,590 1,241 364 6,195
=================== =================== ===================== ==================
At 31 December 2020 5,731 1,376 551 7,658
=================== =================== ===================== ==================
At 31 December 2021 7,304 1,044 288 8,636
=================== =================== ===================== ==================
The total cash outflow for leases was GBP0.9m (2020:
GBP0.9m).
11 Cash and cash equivalents
As at 31 December 2021 and 2020 cash and cash equivalents were
as follows:
Group Company
As at 31 December As at 31 December
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Cash at bank and in hand 31,891 32,509 4,458 4,411
Deposits with credit institutions 376,856 397,518 - -
Cash equivalents 1,386 551 - -
Cash and cash equivalents 410,133 430,578 4,458 4,411
========= ========= ========= =========
The Group considers potential expected credit losses on cash and
cash equivalents to be insignificant.
12 Borrowings
Group Company
As at 31 December As at 31 December
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Current
Bank loans 46,832 53,533 4,507 3,852
46,832 53,533 4,507 3,852
--------- --------- --------- ---------
Non-current
Bank loans 43,957 53,370 15,399 19,904
43,957 53,370 15,399 19,904
--------- --------- --------- ---------
Total borrowings 90,789 106,903 19,906 23,756
========= ========= ========= =========
Bank borrowings
The bank borrowings are repayable as follows:
Group Company
As at 31 December As at 31 December
2021 2020 GBP'000 2021 2020
GBP'000 GBP'000 GBP'000
Within 1 year 46,832 53,533 4,507 3,852
Between 1 year and 5 years 34,928 42,531 15,399 19,904
After more than 5 years 9,029 10,839 - -
--------- -------------
90,789 106,903 19,906 23,756
========= ============= ========= =========
Bank borrowings of the Company are repayable between January
2021 and July 2025 and bear average coupons of 2.25% plus LIBOR per
annum. After 31 December 2021, LIBOR will generally not be
available, the reference rate used to calculate interest will be
replaced by the Sterling Overnight Index Average (SONIA) compounded
in arrear plus a credit adjustment spread. The changes are not
intended to increase the interest rate compared to that under
LIBOR, and the frequency, number and timing of interest payments
remain the same.
Total borrowings of the Group include liabilities of
GBP70,883,000 (2020: GBP83,147,000) secured by legal charge over
certain properties held within non-participating investment
contracts, and liabilities of GBP19,906,000 (2020: GBP23,756,000)
secured on the shares of Curtis Banks Limited, Suffolk Life
Pensions Limited, Suffolk Life Annuities Limited, and Dunstan
Thomas Group Limited.
The company's undiscounted borrowing repayable is GBP4,477k
within one year and GBP16,836k over one year.
13 Provisions
As at 31 December
Other provision Restructuring In-specie Group
GBP'000 provision contributions Total
GBP'000 provision GBP'000
Provisions GBP'000
Balance as at 1 January
2020 246 307 - 553
Amounts provided 53 - 402 455
Amounts arising on
acquisitions 7 - - 7
Amounts utilised (292) (170) - (462)
Amounts released as
unutilised (7) (38) (45)
Balance as at 31 December
2020 7 99 402 508
Amounts provided 211 93 11 315
Amounts utilised - (99) - (99)
Amounts released as
unutilised - - (93) (93)
Balance as at 31 December
2021 218 93 320 631
================ ============== =============== =========
Other provision
As part of the consolidation and integration exercise undertaken
during the year ended 31 December 2018 management initiated a
review of data records relating to commercial properties held
within SIPPs administered by the Group. A provision of GBP500,000
was made for the estimated costs of completing this exercise.
By 31 December 2019, the Group had completed its review enabling
identification of the total number of cases potentially requiring
remediation, and as of 31 December 2020, the vast majority of cases
had been settled. There were no material variances to the original
estimate of future remaining direct costs the Group expected to
potentially bear.
A contingent liability was also recorded in respect of possible
remediation that might be required depending on the outcome of the
review. The estimate of these possible costs at 31 December 2019
was GBP1,400,000. Having largely completed the review during 2021,
management have been able to quantify the expected remediation
costs and provision of GBP211,000 has been made to the remaining
costs as at 31 December 2021.
Restructuring provision
During the year ended 31 December 2019, the Group progressed its
strategy to deliver its Target Operating Model by deciding to
centralise commercial property administration within one office
location. Redundancy costs associated with this decision, relating
to the year ended 31 December 2019, are included as amounts
introduced to the restructuring provision for that year. A further
GBP93,000 provision in 2021 has been made to reflect the updated
estimate of the impact from the restructuring activities.
In-specie contributions provision
As previously reported, the Group has been in correspondence
with HMRC regarding processes and documentation in respect of in
specie contributions. HMRC have alleged that incorrect procedures
were followed and is seeking to reclaim tax reliefs granted and
interest thereon. This is an industry wide issue affecting other
SIPP operators and has been challenged by the sector as a whole.
Following a favourable ruling for HMRC in a case affecting another
SIPP operator, and having taken further legal advice, the Directors
now consider it more likely than not that some cost associated with
this issue will be incurred by the Group.
The total exposure for affected customers is estimated at
GBP1.1m inclusive of interest. However, in recognition of the
possibility that some customers may have insufficient assets to
settle their share of the cost, the Group has recognised a
provision of GBP0.4m as at 31 December 2020. In 2021, this has been
revised to GBP0.3m based on updated information and the movement
year on year has been included in the adjusting items consistent
with prior period.
14 Dividends
Year to 31 December
2021 2020
GBP'000 GBP'000
Ordinary dividend declared and paid 5,997 5,149
5,997 5,149
========== ==========
A final dividend in respect of the year ended 31 December 2020
of 6.5p per share was proposed by reference to audited
distributable reserves as at 31 December 2020 and was paid on 4
June 2021.
An interim dividend in respect of the year ended 31 December
2021 of 2.5p per share was declared by reference to audited
distributable reserves as at 31 December 2020 and paid on 12
November 2021.
15 Contingent consideration
The Group and Company has entered into certain acquisition
agreements that provide for contingent consideration to be paid.
These agreements and the basis of calculation of the net present
value of the contingent consideration are summarised below. While
it is not possible to determine the exact amount of contingent
consideration (as this will depend on the performance of the
acquired businesses during the period), the Group estimates the
fair value of the remaining contingent consideration payable is
GBP7.7m (2020: GBP8.2m).
On 3 August 2020 the Group acquired Dunstan Thomas for total
maximum consideration of up to GBP27.5m, comprising initial
consideration of GBP21.9m in cash plus contingent consideration of
up to GBP5.6m payable in cash after three years post completion
date if certain financial targets based on growth in earnings
before interest, tax, depreciation and amortisation are met. The
Group estimates the fair value of the remaining contingent
consideration at 31 December 2021 to be GBP3.2m (2020: GBP4.1m)
using forecasts approved by the Board covering the contingent
consideration period.
On 30 October 2020 the Group acquired Talbot and Muir for total
maximum consideration of up to GBP25.25m, comprising initial
consideration of GBP18.0m in cash plus contingent consideration of
up to GBP7.25m payable in cash over a two year period post
completion if certain financial targets based on growth in earnings
before interest, tax, depreciation and amortisation are met. The
Group estimates the fair value of the remaining contingent
consideration at 31 December 2021 to be GBP4.5m (2020: GBP4.1m)
using forecasts approved by the Board covering the contingent
consideration period.
16 Unaudited IFRS Consolidated Statement of Financial Position
as at 31 December 2021 split between insurance policy holders and
the Group's shareholders
2021 2021 2021 As restated*
GBP'000 GBP'000 GBP'000 2020
GBP'000
ASSETS Group Total Policyholder Shareholder Shareholder
Non-current assets
Intangible assets 89,814 - 89,814 91,078
Investment property 1,316,468 1,316,468 - -
Property, plant and equipment 8,636 - 8,636 7,658
Investments 2,224,965 2,224,965 - -
3,639,883 3,541,433 98,450 98,736
------------ ------------- ------------ -------------
Current assets
Trade and other receivables 27,981 12,837 15,144 14,406
Cash and cash equivalents 410,133 378,241 31,892 32,509
Current tax asset 957 122 835 359
------------ ------------- ------------ -------------
439,071 391,200 47,871 47,274
------------ ------------- ------------ -------------
Total assets 4,078,954 3,932,633 146,321 146,010
------------ ------------- ------------ -------------
LIABILITIES
Current liabilities
Trade and other payables 20,853 11,398 9,455 8,269
Deferred income 29,960 14,141 15,819 14,619
Borrowings 46,832 42,325 4,507 3,852
Lease liabilities 964 - 964 672
Provisions 453 - 453 501
Contingent consideration 2,467 - 2,467 2,375
101,529 67,864 33,665 30,288
------------ ------------- ------------ -------------
Non-current liabilities
Borrowings 43,957 28,558 15,399 19,904
Lease liabilities 6,774 - 6,774 5,201
Provisions 178 - 178 7
Contingent consideration 5,199 - 5,199 6,537
Non-participating investment
contract liabilities 3,836,211 3,836,211 - -
Deferred tax liability 3,464 - 3,464 3,790
------------ ------------- ------------ -------------
3,895,783 3,864,769 31,014 35,439
------------ ------------- ------------ -------------
Total liabilities 3,997,312 3,932,633 64,679 65,727
------------ ------------- ------------ -------------
Net assets 81,642 - 81,642 80,283
------------ ------------- ------------ -------------
Equity attributable to owners of
the parent
Issued capital 332 - 332 330
Share premium 58,087 - 58,087 57,799
Equity share based payments 2,840 - 2,840 2,747
Treasury shares (1,382) - (1,382) (741)
Retained earnings 21,755 - 21,755 20,134
------------ ------------- ------------ -------------
81,632 - 81,632 80,269
Non-controlling interest 10 - 10 14
Total equity 81,642 - 81,642 80,283
------------ ------------- ------------ -------------
17 Unaudited IFRS Consolidated Statement of Cash Flows as at 31
December 2021 split between insurance policy holders and the
Group's shareholders
As restated*
2021 2021 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Group Total Policyholder Shareholder Shareholder
Cash flows from operating
activities
Profit before tax 9,322 - 9,322 7,429
Adjustments for:
Depreciation 1,806 - 1,806 1,499
Amortisation and impairments 2,934 - 2,934 2,088
Finance costs 1,800 - 1,800 885
Share based payment expense 93 - 93 434
Fair value gains on movement
in contingent consideration (1,870) - (1,870) -
Fair value gains on financial
investments (213,701) (213,701) - -
Additions of financial
investments (647,479) (647,479) - -
Disposals of financial
investments 708,532 708,532 - -
Fair value losses on investment
properties (120,416) (120,416) - -
Increase in liability for
investment contracts 250,904 250,904 - -
Changes in working capital:
Increase in trade and
other receivables (1,330) (593) (737) (1,523)
Increase/(Decrease) in
trade and other payables 5,017 2,386 2,631 (477)
Taxes (paid) / refunded (2,410) 100 (2,510) (2,996)
Net cash flows from operating
activities (6,798) (20,267) 13,469 7,693
------------- -------------- ------------- -------------
Cash flows from investing
activities
Payments for intangible
assets (1,670) - (1,670) (986)
Purchase of property, plant
& equipment (270) - (270) (591)
Purchase of investment
property (92,456) (92,456) - -
Purchase and sale of shares
in the Group by the EBT (641) - (641) (207)
Receipts from sale of investment
property 105,009 105,009 - 42
Net cash flows from acquisitions (255) - (255) (34,484)
Net cash flows from investing
activities 9,717 12,553 (2,836) (36,380)
------------- -------------- ------------- -------------
Cash flows from financing
activities
Equity dividends paid (5,997) - (5,997) (5,149)
Net proceeds from issue
of ordinary shares 290 - 290 24,199
Net increase/(decrease)
in borrowings (16,114) (12,114) (4,000) 12,235
Principal element of lease
payments (762) - (762) (934)
Interest paid (781) - (781) (383)
Net cash flows from financing
activities (23,364) (12,114) (12,250) 29,968
------------- -------------- ------------- -------------
Net increase in cash and
cash equivalents (20,445) (19,828) (617) 1,281
------------- -------------- ------------- -------------
Cash and cash equivalents
at the beginning of the
year 430,578 398,069 32,509 31,228
============= ============== ============= =============
Cash and cash equivalents
at the end of the year 410,133 378,241 31,892 32,509
============= ============== ============= =============
*The audited results for year ended 31 December 2020 have been
restated to account for measurement period adjustments arising
under IFRS 3 Business Combinations relating to the acquisitions of
the Dunstan Thomas Group and the Talbot and Muir Group that took
place in H2 2020.
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END
FR SDDSMFEESEFD
(END) Dow Jones Newswires
March 31, 2022 02:17 ET (06:17 GMT)
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